Investors have become a vital part of most tech Startups and a number of really great Startups have emerged from investments of several Venture Capital firms. This encourages more entrepreneurs to search and apply for investment to kick start or boost their existing companies.
VC firms play a major role in financing Startups and essential support to existing companies for them to grow. Any new Startup requires adequate funding based on their burn rate and most can calculate the date they will run out of seed capital.
Many Venture Capitalists finance specific types of businesses or technologies and early stage funding is particular difficult to obtain globally. Finance for such new Startups should be found by approaching the right type of Venture Capital firm. e.g one that backs your type of company in that market sector but not usually a direct competitor.
This is one of the reasons meeting and talking to investors directly is one of the most difficult tasks for any Startup entrepreneur. Most Angel Investors and VCs receive many pitches all the time and screening them for new and innovative ideas can be difficult. It’s up to the entrepreneur to convince the investor their business has actual potential in a very large global market at scale.
Due to these obstacles it’s not unusual for entrepreneurs to speak to over 100 investors before finally getting 1 to invest in their business, while some might not even get an investor at all and end up having to bootstrap their startup instead.
If you are a Startup looking for investors, here is a list to help you find and identify potential investors that could be interested in your company:
- Rosemont Group Capital Partners
A UK & USA based seed and early stage Venture Capital firm, who has announced its intention to invest in as many as 20 Startups and early stage companies every 2 years. Its primary investment focus is ecommerce, technology, food and beverages, entertainment, hospitality, fashion and energy.
The group invests capital through direct equity investments, convertible loan/notes, options, warrants or preferred shares and invests on its own or with other Angel Investors in one or more funding rounds. So far the firm has achieved a lot of success and says there is more to come in the future. According to their co-founder Fred Achom “The focus of the fund is to back innovative technology ventures with potential for exponential growth, providing seed funding for Startups.” Entrepreneurs can request that at http://RosemontGroup.net
- Octopus Investments
A VC company with total funds under management of £5 billion. They invest in Europe wherever they find the right talent and opportunity. Its Venture Capital funds are pan-European, with about two-thirds currently earmarked for UK based businesses. On average, they make investments of around £2.5 million. They support exceptional technology with the ambition to grow businesses big. Their main objective is the identification of fast growing companies with entrepreneurs that can scale explosively to create, transform or dominate an industry. They operate in several sectors including consumer innovation, hardware and software.
Lakestar is another Venture Capital firm looking to invest in promising new Startups. Their geographic focus encompasses both Europe and the United States, including representing partners in key cities on both continents. Lakestar has invested in companies based in the UK and has about 20 companies in its portfolio. Instead of focusing on a particular segment of the technology industry, Lakestar looks at a wide range of sectors.
- Passion Capital
Passion Capital is made up of partners Stefan Glaenzer, Eileen Burbidge and Robert Dighero with a total of $ 86 million in investments. Fund I included eight investments in European companies (out of a total of 42); Fund II (£45 million has £10 million reserved for European investments, the remainder or most of the fund is mainly for the benefit of the UK economy). They particularly invest in sectors such as cyber security, information security, education technology, health and medical technology.
- Index Ventures
Founded in 1996, Index Ventures invests in early stage Startups in both Europe and the US. However, approximately half of their current portfolio is in Europe and they are active in major European technology centers including Amsterdam, Barcelona, Berlin, Paris, and London. They invest in the early stages all the way through to the later stages of a company. They have made more than 100 investments in the last five years, with about 25 new investments annually. They are very active in all areas, investing in multiple stages, geographies and themes.
Other alternatives to Venture Capital funding include Convertible Debt, Seed Funding, Private Placements, Angel Funding, Crowdfunding, Venture Debt, Angel Investment or a Mini Series A.
When approaching investors it’s a good idea to make sure they are accredited and to always seek professional advice. Some law firms or websites even offer the paperwork required for free when previously it could cost up to £35,000. e.g Terms Sheets, Vesting and other contracts or agreements.